Outsourcing is a popular business trend, especially when it comes to app or software development. Many companies hire an external team of developers to carry their vision through to completion, and it’s easy to see why. Saving money, conserving time, and bringing in experts are just a few of the reasons to outsource.
But if you’ve never outsourced before, where do you start?
Here are some tips and steps to get you started.
Which pricing model should you use for outsourcing?
One of the great things about outsourcing is that there’s not just one way to do it. Depending on your project, resources, and objectives, you can chart your own course using one of the following models:
- Project-based
- Dedicated team
- Staff augmentation
- Time and material
- Fixed price
1. Project-based
In this model, you outsource the entire project from beginning to end. Your outsourced team handles all components of the project, including management, then hands it back to you once the project is completed.
With this model, you’ll generally decide pricing ahead of time, which means you don’t necessarily pay by the hour. That makes this a great model for projects where the scope is fixed and the requirements won’t change.
2. Dedicated team
Other times, it may work better to simply outsource a team to work on the project with you. In this case, you can hire professionals to serve as an extension of your team, but they’ll still work in conjunction with you and your internal team throughout the project. In this model, you’ll usually decide pricing based on the number of team members and number of hours.
3. Staff augmentation
In this approach, you’ll still hire an outsourced team to work on the project, but you’ll manage them. This may be a good approach if you want to be deeply involved in the development process.
4. Time and material
Many developers prefer the time and material model. This approach typically follows the Agile methodology, which allows you to be involved in the development and remain in open communication with your outsourced team.
If parts of the scope change during development, which often happens, this approach makes it easy for you to reassess and keep moving forward. Pricing is typically calculated based on hours of work.
5. Fixed price
Fixed price used to be the way to go, but these days, most people prefer a more flexible model. In fixed price, you determine pricing and scope upfront. That means that if you run into bugs, decide to add more features, or realize you need to adjust your project goals, you’ll have to open a new contract. Doing so will usually cause a significant delay.
Then again, if your project is small and clearly defined, and if you’re 100% sure the requirements and schedule won’t change during development, fixed price may be the right model for you.
3 steps for smart, successful outsourcing
So how do you go about outsourcing? Where do you start, how do you find a team, and how do you choose the right one? Here are three steps to get you on your way.
1. Clarify your goals for the project—and for outsourcing
2. Search for outsourcing companies
3. Narrow it down
Next steps
Need an experienced, highly rated outsourcing team? We have more than 20 years in app and software development, and we’re happy to talk. Contact us now to get started.
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